Wednesday, June 30, 2010

Coalition urges FCC to block proposed merger of Comcast-NBC

Coalition urges FCC to block proposed merger of Comcast-NBC
Gautham Nagesh
06/21/10
A coalition of media companies, unions and nonprofits is urging the Federal Communications Commission to block the merger of Comcast and NBC Universal.

The coalition, made up of organizations including media giant Bloomberg, the Writers Guild of America, West and advocacy groups like Free Press and Media Access Project, wrote to FCC Chairman Julius Genachowski on Monday voicing their opposition to the proposed merger of Comcast and NBC-Universal.

Monday is the last day for organizations to submit public comment to the FCC on the proposed merger, which would create a new $30 billion joint venture merging the Philadelphia cable giant's content division with NBC Universal's (NBCU) stable of television networks, film studios and theme parks. Govs. Arnold Schwarzenegger, (R-Calif.), David Paterson, (D-N.Y.) and Ed Rendell (D-Pa.) have expressed support for the merger.

The groups argue the new entity would have unprecedented control over the country's media landscape, raising antitrust concerns.

"The proposed merger of Comcast and NBC-Universal is poised to fundamentally alter the landscape of the U.S. media market," the letter states. "We are a group of varied organizations with many specific concerns with this merger, but we have joined together because the threat of this merger to consumers is so great."

"As filed," it goes on, "we oppose this merger."

According to the letter, the new entity created by the merger would include the largest cable company, the largest residential broadband Internet service provider, the owner of one of the four national broadcast networks, several prominent local stations, cable networks and some of the most popular websites.

This would give the company "a degree of market power unrivaled in our nation's media history," the letter claims.

Comcast executive vice president for public policy David Cohen responded to criticism of the deal Monday afternoon in a lengthy blog post citing the numerous elected officials, advocacy groups and labor organizations that have endorsed the merger. He also indicated that many critics are motivated by business interests, not concern for consumers.

"It is important to keep in mind as you read the comments from opponents of this transaction that the businesses in which Comcast operates in today – distribution, programming, online, high-speed Internet, and voice — are all fiercely competitive," Cohen writes.

"Comcast and NBCU don’t compete against each other in most segments of the market, so there is no new concentration. There are no cable systems involved in this deal, so Comcast’s distribution platform will not grow."

“If the Comcast-NBC deal goes through, it would be one of the largest media mergers in a generation, leaving Americans with even higher cable bills and fewer diverse, independent choices on the dial," said Free Press President Josh Silver. "Approval of the deal would be business as usual in Washington, letting the largest companies have their way at the public’s expense."

Silver said the deal is particularly bad for consumers in the 12 markets where Comcast is the leading cable and broadband Internet provider and NBC has a local TV station, including Washington, D.C. He also warned the deal could threaten the viability of online video sites like Hulu.com, claiming Comcast could prioritize its own online content in violation of the principle of net neutrality.

Sen. Herb Kohl, (D-Wis.), chairman of the Senate Judiciary subcommittee on antitrust, competition policy and consumer rights, wrote to the FCC last month asking the commission to impose a host of conditions on the deal, including a promise from Comcast not to discriminate against content from other networks.

The full list of organizations that co-signed the letter follows:

Bloomberg LP

Common Cause

Communications Workers of America

Free Press

Media Access Project

The National Association of Independent Networks

The National Coalition of African-American Owned Media

National Consumers League

The Organization for the Promotion and Advancement of Small Telecommunications Companies